5 Questions to Ask Before Buying a Franchise

5 Questions to Ask Before Buying a Franchise

5 Questions to Ask Before Buying a Franchise

For many aspiring business owners in Florida, buying into a franchise can be an alluring prospect. After all, a franchise comes with an established brand, plus the setup has already been taken care of. While obviously less of a risk than starting your own unique venture, franchising isn’t for everybody. Asking yourself these five questions can help give you a better idea if a franchise is right for you.

Can You Put in the Necessary Work?

Although the work that goes into setting up and launching a business has already been taken care of for you, buying a franchise still requires significant effort and care to be successful. As the owner, you will be responsible for the business’s day-to-day operations as well as ensuring that the franchisor’s rules and/or guidelines are enforced. You’ll be in charge of hiring and terminating employees, running promotions, and more. A franchise is not a turnkey operation. If you’re unsure whether you can commit the needed time and energy, or if you have difficulty making decisions under pressure, then you might want to reconsider if buying a franchise is right for you.

Will Your Franchise Fit Your Desired Lifestyle?

Owning a franchise, just like any other business or entrepreneurial venture, requires a certain lifestyle. Long hours are almost a given, and holidays and weekends won’t always mean time off for you anymore. Franchises with physical locations, such as restaurants and hardware stores, can tether you to a certain location. And if that certain location is far away from your place of residence, then you need to be prepared for long commutes.

Franchises in different industries, however, can offer some more flexibility, and this is especially true for seasonal businesses. Consider these options if you hope to travel more or want to spend more time at home with your family before buying a franchise.

Is This a Purchase That You Can Afford to Make?

Please, please make sure that you can actually afford buying a franchise before pulling the proverbial trigger on it. It is not at all uncommon for franchisees to bankroll their operations by borrowing from family or friends, the bank, or the Small Business Administration, depending on their credit ratings and the necessary down payments. You also need to thoroughly review the Franchise Disclosure Document provided to you by the franchisor. These records show the expected costs of running the business and any additional payments required by the franchisor.

Are You Positive That Buying a Franchise is a Good Investment?

Do your due diligence before buying a franchise. It’s not a good investment just because you like the food they serve or the real estate it sits on. Take the time to research the local demand for the product or service that you’re looking to provide while also sizing up the competition that you can expect to face off against. You also need to take a good look at the franchise’s history, how long they were in business for, how many other locations there are, and the like. Do some homework on the franchise owners as well – you don’t want to find yourself taking on someone else’s mess!

Does the Franchisor Have Your Back?

If your chosen franchise is really on the ball, then you can expect them to provide you with comprehensive materials that explain how to best manage the business. Some even offer training. Unfortunately, this isn’t true for all franchisors. The worst offenders offer little or no support after the transaction is complete. When you’re on your own, it can mean trouble between you and the franchisor as expensive, otherwise avoidable mistakes pile on.

More information can be found on buying businesses here.

Looking to start a business or grow your current business? Contact FL Patel Law today by visiting our website or calling (727) 279-5037.

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